A Stochastic Net Model for Controlling Bullwhip Effect in Virtual Multi-Tier Retail Network

Abstract: Supply Chain operation is an integrated business process starting from primary supplier to end user and the process produce products, services and information. A successful chain will explore technology, lean operations, and quality management by adding value for customers and stakeholders. It is a strategic alliance among the partnering enterprises without geographical boundary. Every chain has its own unique set of market demands and operating challenges. Retailing is one such service domain of Supply Chain vulnerable to bullwhip effects. Demand uncertainty is one of the root causes of Bullwhip effects. This paper calls for modeling of a demand driven multi-tier stochastic Retail Chain to work against the Bullwhip effect. The proposed model of the operational chain will ensure significant return of share to the retailer through the sophisticated transaction management, real-time inventory management and the ability to track all inventory movements.